BT is planning to make changes to the way it pays its senior managers after shareholders staged a protest over the bonus awarded to outgoing chief executive Gavin Patterson earlier this year. The telecoms company said on Tuesday that its remuneration committee would now take steps to implement a “more structured process” that will take into consideration a “broader range of performance factors and wider circumstances” when setting pay. The decision follows a bruising vote at the company’s annual general meeting in July, when 34% of investors rejected its remuneration report. BT Group (BT.A) said it was “naturally disappointed” with the outcome, and having spent time speaking to investors since, it had found that most of their concerns were about the amount Mr Patterson received for his bonus. Mr Patterson’s £2.3m pay packet comprised a £1m hike in his annual pay and included a £1.3m annual bonus, £997,000 in basic salary and £299,000 in pension payments.
The energy regulator is poised to squeeze £6.5bn from the companies operating Britain’s electricity networks as they prepare to plug in to a boom in renewable power and electric vehicle charging. Under Ofgem’s plans companies including National Grid (NG.), Scottish Power and SSE (SSE) will need to drive billions worth of investment into updating their energy grids for a ‘smart’ energy future, while charging customers less from 2021. Ofgem said its plan to “rewire” the energy market could save households £45 a year on their energy bills, based on what they might otherwise have been. However, these savings are not guaranteed and the plans threaten to put off investors thanks to the tighter-than-expected squeeze on company earnings, the industry has warned. The bulk of the £45-a-year saving will be driven through Ofgem’s regulatory regime by pressing the cost of capital down by half to save customers £30 a year. The remaining £15 saving will be delivered by changing the charging regime for companies and households who connect.
Billions of pounds have been wiped off retail shares after a shock profit warning at online giant Asos stoked fears of another miserable Christmas period for embattled high street stores. ASOS (ASC) slashed its full-year sales guidance after suffering a “significant deterioration in the important trading month of November”. It now expects sales growth of 15%, compared to its previous guidance of 20-25%. Asos blamed “economic uncertainty” for weakening consumer confidence across its main markets and a “high level of discounting and promotional activity” for its worst sales growth in recent years. Signs of turmoil in the sector spreading to online spooked investors after a number of warnings from high street stalwarts in recent weeks. boss Mike Ashley said last week that November had “been the worst month on record, unbelievably bad” for high street stores while Primark – Associated British Foods (ABF) warned earlier this month of a “challenging” Christmas run-up. “If Asos is finding it tough out there, then just about every retail stock has problems,” said Neil Wilson at Markets.com Asos shares plunged as much as 43% after the downgrade as around £3bn was knocked off the value of London-listed retailers. Next (NXT) and Marks & Spencer Group (MKS) slipped as much as 8.5% and 5.3%, respectively, before clawing back some of their heavy early losses.
Plans for the biggest energy company merger since privatisation have fallen apart after SSE (SSE) said it would not set up a new listed energy supplier with its rival Npower. The pair called time on the eleventh hour talks to save the troubled merger after they failed to agree on new terms needed to fortify the nascent company against deepening energy market woes. The new company was expected to debut on London’s premium stock listing within months, after more than a year of negotiations, as the second largest energy utility in the market.
